The antiatherosclerotic effect of aqueous leaves extract of Morus rubra was studied in streptozotocin-induced diabetic rats fed with atherosclerotic (Ath) diet [1.5 ml olive oil containing 8 mg (3, 20,000 IU) vitamin D2 and 40 mg cholesterol] for 5 consecutive days. A short-term toxicity assessment was also conducted in healthy rats to examine toxic effects of the extract. Oral administration of extract to diabetic rats (100, 200 and 400 mg/kg body weight per day for a period of 30 days) produced significant (p<0.001) fall in fasting blood glucose (FBG) in a dose-dependent manner. Treatment with the extract (400 mg/kg) showed significant (p<0.001) improvement in body weight and serum lipid profile i.e., total cholesterol, triglyceride, HDL-cholesterol, LDL-cholesterol and VLDL-cholesterol, when compared with diabetic control. Endothelial dysfunction parameters (sVCAM-1, Fibrinogen, total NO levels and oxidized LDL), apolipoprotein A and apolipoprotein B were significantly (p<0.001) reversed to near normal, following treatment with the extract. Thus, our study shows that aqueous leaf extract of Morus rubra (400 mg/kg) significantly improves the homeostasis of glucose and fat and possesses significant anti-atherosclerotic activity.